Ask Reggi Your Question Now

Reggi is the free generative AI assistance for regulatory compliance
Ask a Question

Can I use crowdfunding to raise money without violating securities laws in Nevada? What are the requirements?

Requirements for Crowdfunding in Nevada

Crowdfunding is a way to raise money from a large number of people, typically through an online platform. In Nevada, crowdfunding is regulated by both federal and state securities laws.

Under Nevada law, crowdfunding is allowed under certain conditions. The Nevada Securities Division has adopted regulations that allow for intrastate crowdfunding offerings. These regulations are found in Chapter 90 of the Nevada Revised Statutes and Chapter 90 of the Nevada Administrative Code.

To use crowdfunding to raise money in Nevada, you must meet the following requirements:

  1. The offering must be made only to Nevada residents [2].
  2. The issuer must be a Nevada business entity [2].
  3. The offering must be conducted through a registered crowdfunding portal [2].
  4. The issuer must file a notice of the offering with the Nevada Securities Division [2].

Federal Requirements

In addition to the state requirements, issuers must also comply with federal securities laws. The Securities and Exchange Commission (SEC) has adopted rules that allow for crowdfunding offerings under Regulation Crowdfunding (Reg CF) [5].

Reg CF imposes a number of requirements on issuers, including:

  1. The issuer must use a registered crowdfunding portal [5].
  2. The issuer must provide certain disclosures to investors [5].
  3. The amount that can be raised is limited [5].
  4. The issuer must file certain reports with the SEC [5].

Conclusion

In summary, crowdfunding can be used to raise money in Nevada, but it is subject to both state and federal securities laws. To comply with these laws, issuers must meet certain requirements, including using a registered crowdfunding portal and providing certain disclosures to investors. It is important to consult with a securities attorney to ensure compliance with all applicable laws and regulations.

Source(s):
Jurisdiction

Nevada